Though it is unknown precisely when the laboratory became operational, it went through significant changes in mid-1998 when Vincent Goldman was assigned by Umbrella headquarters as the island's commander. Much of the facility's research was focused on production of the T-103 series of Tyrants, though secondary research on potential B.O.W.s such as Plant 43 were also continued here as they were in Raccoon City, and the Hunter α as in the Arklay Laboratory. A fourth project undergoing at the facility was Hypnos-T Type, a prototype Tyrant model intended to surpass the T-103 series entirely.

In November 1998 the t-Virus was intentionally leaked from this facility by Goldman, who intended to quash a plot against him and pass it off as an accident on escape. The Hunters and a number of the T-103s were released from their containment to rampage across the city, ensuring its destruction. The facility was later infiltrated by Ark Thompson and two children, Lott and Lily Klein, who were in search of a means of escaping the island. A team of Under Takers, intelligent B.O.W.s armed with guns, was soon after sent into the facility by Umbrella in their cleanup efforts, which included the elimination of witnesses. The self-destruct system was triggered during the chaos, and Hypnos itself was released. Ark; Lott and Lily are the only known survivors of the incident on the island as a result of this chaos, having escaped on a helicopter before much of the island was destroyed by the Tyrant Plant's detonation.